The Path to Virtual Advisors Begins with Getting to Know your Customers

This piece was co-authored by JD Metcalf, Laura Watson and Nicole Pawluck.

Consumers are demanding a more personalized banking experience. Right now. If banks wait to offer this form of on-demand engagement, they risk being left behind. But many banks, including major brands, don’t have the resources to build a personalized, automated system.

So what can be done today to begin on the necessary path?

Consumer Expectations Are Set By GAFA

Every day we read about the increasing expectations customers have of their banking experience. They want a banking experience that resembles the personal assistant-like interactions they encounter with Google, Amazon, Facebook and Apple (collectively known as GAFA). Here, consumers are spoon-fed personalized content on demand. Being able to deliver this kind of experience to customers is critical to a bank’s success.

This customer need for a more personalized digital user experience has been a blind spot for a number of banks. This is not surprising and is completely reasonable. With secure market share and limited encroachment by financial technology (FinTech) firms, traditional banks have not been forced to address the issue.

For instance, a Forrester survey of CEOs showed that bank CEOs see less digital disruption today than CEOs in other segments. [1] But that era of ignoring the advancing needs of the customer has officially come to an end.

Percentage of CEOs who believe digital has disrupted their industry:

Consumers are spoon-fed personalized content on demand. Being able to deliver this kind of experience to customers is critical to a bank’s success.

Here is some data that should create a stronger sense of urgency for banks to take action:

First, consumer surveys conducted by a number of firms show that over 46% of consumers would strongly consider switching to one of the GAFA providers if they offered banking products. [2] Let’s hope Google doesn’t go into banking any time soon then.

Further evidence shows up in the 2016 JD Power Banking Customer Satisfaction scores, which are based on a 1,000-point scale. For the first time ever, Mega Banks out-performed Regional and Community Banks. But the key to the Mega Bank success shows up in the customers’ satisfaction with their digital experience. There is a big gap between Mega Banks that can afford to invest in a personalized digital experience with supporting technology, and the smaller banks that do not have the resources to craft that personalized digital experience.

The evidence is clear. A personalized digital experience is the new standard that all banks will be asked to achieve. This isn’t just about Millennials. It is a request by all generational segments. Failing to meet this request results in brand failure. Just ask veterans of Blockbuster Video.

Some banks are already well on their way to launching the first generation of digital virtual assistants. Barclays, Captial One, USAA, Ally and Bank of America have all either launched or made announcements that they will launch to the public by early 2018 (just a few months away!).

What can be done today while the next generation solution is being built?

But what do you do to drive revenue and meet customer needs now, while you wait for your IT department to build the automated, real-time, omnichannel, virtual, buzz-creating, cloud-based, personalized solution?

You understand what the real ask is from the customer.

Consumers aren’t necessarily looking for a higher-tech experience. In fact, most consumers are suffering from various forms of tech fatigue. As an example, ComScore reports that only 12% of apps that are downloaded are actively used. That leaves the other 88% collecting digital dust on smartphones.

What consumers are truly looking for is a more personalized experience. All of us are consumers in some form or fashion, and we are all exposed to an overwhelming number of promotional offers in our inbox, on our social feed, and even in the trade journals we read. We’ve all been victim to ads that have been disguised as white papers (not this one of course… pure, valuable content here!).

All any of us want in return for the time we invest with these forms of content is meaningful value — a return for our attention (ROA). And the more we as marketers can personalize the material so that it meets the needs of the consumer, the more satisfying the experience and the more likely they are to continue to consume and respond to our content. Both common sense and reams of research support this.

What does a personalized human experience look like?

A personalized experience can take a lot of forms and can be delivered via a number of channels. At the most basic level, it consists of relevant and engaging messages delivered in the channels that the reader is most likely to use, in the moments that they are likely to use them. So, it is our job then to find the audiences that will find our offerings useful (through market segmentation), and make sure we deliver those offerings in the right channel, at the right time, with messages that resonate. In a more advanced environment, organizations tailor everything, including re-imagining their product and service offerings to meet consumers’ core needs.

There are ways to personalize the customer experience even if you are early in your journey toward that personalized content delivery.

Simply delivering an offer that matches a customer’s needs is a great way to start. Think of your own experiences as a consumer. We all receive email, digital and direct mail solicitations. When we do receive an offer that lines up with a specific need we have or speaks to us in ways that we can relate to as an individual, we are willing to pause and invest time because we know we’ll receive a return on that investment.

How do we start building a personalized experience?

To start providing a more personalized, contextual experience for our customers, we need to add a more human element back into our marketing. We need to focus on the customer and truly understand who each person is and the jobs he or she is trying to complete. Your initial application of more human marketing can be simple and focus on impacting your current campaigns – both online and offline. This does not need to involve major investments in digital technology and data augmentation. It all boils down to focusing on the right audiences and getting to know them more deeply than we have in the past.

Identify the right customers through segmentation

The first step in more personalized, human marketing is identifying the right audience and understanding who our offerings connect with. In other words, find your target market. In its simplest form, delivering messages that resonate hinges on finding the segments within our customer base that are most likely to need a particular product or service. This seems like such a basic step that it may seem trivial to bring it up. And it is basic. But it is often overlooked.

Get to know your optimal customers – deeper than traditional personas

After we have identified the market segments with which we have the best opportunities, we need to get to know the people within them. Really well.

If we want to communicate more humanly with our customers, traditional demographic personas just aren’t good enough anymore. We all play varying roles in our daily lives (wife, parent, professional marketer, best friend, etc.) and end up in various situations that cause us to begin buyer’s journeys. Understanding these roles and situations helps us as marketers to speak contextually — personally — to our customers.

Understand the buyer’s journey and customers’ jobs to be done

In addition to knowing a lot about your customers’ roles and situations, you also need to understand why they enter into buyer’s journeys with your brand, and where they currently sit in that journey. The most effective framework through which to understand this journey is Tony Ulwick’s Jobs-to-be-Done Theory. As Theodore Levitt said, “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”

People buy products and services to get jobs done; and while products come and go, the underlying job to be done does not go away.

Looking at the buyer’s journey through this Jobs-to-be-Done lens, there are 5 overarching stages. Within each of the 5 stages, there are specific goals a customer is looking to accomplish on the journey to solving his or her problem.

For example, let’s take Emily. She is single, 32 years old and buying her first home. She is shopping for a mortgage right now. But what is her actual job to be done? Simply put, her job to be done is home ownership. That’s it. She really doesn’t want nor need anything else.

A mortgage just happens to be required in order to get the home. Home ownership is the goal; a mortgage is just a tool to help her get there.

Let’s walk Emily through the five stages of the Jobs-to-be Done approach as she shops for her mortgage:

During the problem recognition stage, Emily recognizes that it will cost a lot of money to buy a home and that she’ll need to figure out how to pay for it. At this point, she may or may not choose to continue toward completing her job of buying a home.

In the information search stage, she’ll figure out what types of mortgages are available to her. Her job here is to determine what her options are.

By the evaluation stage, she’s actively evaluating her mortgage options and which lender may be the best fit. Emily’s job at this stage is to decide which mortgage to obtain and where to obtain it.

In the purchase stage, Emily’s job is to obtain her mortgage. She may prefer to do this online or in a branch.

Finally, in the post-purchase evaluation stage, she Emily decides if the mortgage meets her needs and how she feels about her experience. She may or may not choose to share this experience with her friends, family and other networks.

Provide Valuable Content

Knowing your customers deeply, understanding which stage of the journey they are in, and understanding what jobs they are trying to complete, will help you to provide them with the most appropriate content in that moment. In other words, having this knowledge will allow you to create relevant, personalized communication — and loyal customers.

Let’s go back to Emily’s example. If Emily is Googling, “What will my mortgage payment be on a $250,000 home?” it would make sense to offer her a calculator that helps her determine what

she can afford. If she’s searching for, “What is an ARM?” it may be a good time to offer her an informational piece on the types of mortgages available and their pros and cons. But if she’s on your website looking at your specific mortgage offerings, she’s more likely to respond to an offer with your current mortgage rates and information about the application process.

Get started with your existing data

The good news is that banks already have a lot of data that can provide clues about consumers’ personas and what they’re trying to accomplish. It is our belief that a single regional bank has more actionable consumer data than Google and Facebook combined. Search engines and social networks use algorithms to predict (aka guess) what a consumer may buy next. Banks know exactly what each consumer’s buying habits look like.

The bank knows the transaction date, type, location, amount, frequency, etc. This kind of information reveals more than just a customer’s purchase preferences; it reveals how and why a customer purchases — and even what she or he values.

Tapping existing customer data is a method that a number of marketers currently use to get a glimpse into who their customers are, why they’re interacting with the brand and where they sit in the journey. An Adobe survey of digital marketers showed that 66% of them use CRM data to fuel their marketing campaigns. [3]

Don’t have the data? Try quick, inexpensive research.

Large enterprises and microbusinesses alike routinely test ideas before they take them to market, saving tens of thousands of dollars, and years of time, developing products and services that fall flat with their target audience. If you haven’t used market research to help steer the growth of your business, you need to. Overlay it with your content and SEO to achieve your marketing goals.

Author Tim Ferriss, of “The Four Hour Workweek”, famously used Google AdWords (Pay-Per-Click Marketing) to split test the name of the book he was writing to go to market “first”, and find out which business idea aligned with his target market. Once he arrived on a clear winner, he then expanded the idea, tailoring his solution to the audience’s needs. Too often the reverse is true. Testing concepts to gauge interest, tailor products and refine messaging is a smart strategy.

Psychographics, which measure a consumer’s attitudes and interests, are just as important for marketers as demographics, according to the Harvard Business Review. With the Internet, it’s much easier to access psychographic insights and differences, and make them actionable.

Remember, good marketing is leveraging all the data to target the optimal customer mix with the right message at the right time. Great marketing is a mixture of science and art. True customer insight blends data and behaviors, not only helping you to achieve the right “in the moment” marketing, which recipients highly value at a time they need it most, but also develop the products and services that specific customers want and need.

About the Author

As Vice President, Marketing Strategy at Harte Hanks, JD has a consistent record of creating and executing marketing strategies that achieve industry-leading performance. For example, he has launched integrated campaigns that increased customer share of wallet by over $300 million. He has achieved customer retention 6.1% above industry peers by creating an automated one-to-one omnichannel new customer onboarding program. And JD has led the development, creation, and launch of customer loyalty CRM programs that consistently produced results 79% above industry average. He currently specializes in marketing in the financial services industry.